Covering the Industrial Complex.

Foreign Military Sales: America is the World’s Biggest Arms Dealer

The countries of Qatar and the United Arab Emirates (UAE) are ordering $7.6 billion worth of missiles from the United States. Gant Daily reports that Qatar will receive 150 missiles worth $6.5 billion, and the UAE will receive 48 missiles worth $1.135 billion. According to the report the Pentagon says that it recommended the sales to “strengthen security in the Gulf region,” in large part due to concern about Iran’s alleged development of nuclear weapons. Defense contractor Lockheed Martin is the major benefactor of the deal, and other contractors including Reytheon, Boeing, and BAE Systems were involved in the development of the technology.

Lockheed Martin was also the benefactor of a $26 million deal through the US Air Force to modernize Jordan’s air force air command. As reported by the Associated Press, the deal was made with the US ally to help “defend its airspace and ensure air sovereignty.” This was in large part due to the threat of spillover violence from the ongoing civil war taking place in Jordan’s neighbor of Syria.

In addition to the $6.5 billion in missiles, Qatar has also requested $9.9 billion worth in Patriot anti-missile missiles. According to a report by United Press International, the deal would include more than 700 Patriot missiles along with firing units and radar systems. Along with the missiles, training of personnel and logistics support would also be part of the deal; Lockheed Martin would once again be the prime benefactor along with Raytheon.

Saudi Arabia has ordered twenty C-130’s and five KC-130’s worth $6.7 billion. The Pentagon says that the planes are needed by Saudi Arabia to “sustain its aging fleet, which faces increasing obsolescence.” Bloomberg’s BusinessWeek reports that Lockheed Martin will once again be the major benefactor of what represents the largest foreign military sale of C-130’s in history.

All of these deals from the last few weeks represent just a fraction of US arms deals this year. The program facilitated by the Pentagon officially known as Foreign Military Sales, sells US made defense equipment all over the globe. In September, BusinessWeek reported that FMS for fiscal year 2012 were already at $65 billion. That is more than double the previous high for sales in 2009 of $29.6 billion. Since 2004 FMS have totaled more than $200 billion. From 1950 to 2003 FMS totaled $345 billion.

According to statistics compiled by the Stockholm International Peace Research Institute, the United States is by far the world’s leading arms dealer. Only Russia rivals the United States in the arms trade. Since 2001 the arms trade has exploded, and much of the arms made by American defense contractors have gone to the Middle East. This year the cost of arms sales was made cheaper, as the FMS administrative surcharge rate for arms customers was lowered by 8 percent from 3.8 percent to 3.5 percent.

The Defense Security Cooperation Agency (DSCA) is an organization within the Department of Defense that facilitates the sale of defense items. DSCA manages portfolio valued at $385 billion that includes more than 12,000 deals with 224 countries. America deals arms to just about every country on the planet. It’s authority comes from the Arms Export Control Act (AECA), and it is used as another tool implement US foreign policy.

Congress does have oversight of the program, and DSCA is required to notify Congress of major arms deals. You can find Congressional notifications on the DSCA web site, and an archive of notifications dating back to 2001. Additionally you can view FMS statistics on the DSCA web site, that include a breakdown of sales to each country.